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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 8-K

                             CURRENT REPORT PURSUANT
                          TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                                 March 30, 2007
                Date of Report (Date of earliest event reported)

                            PAYLESS SHOESOURCE, INC.
             (Exact Name of Registrant as Specified in its Charter)

                                    DELAWARE
                 (State or Other Jurisdiction of Incorporation)

             1-14770                                  43-1813160
     (Commission File Number)              (IRS Employer Identification No.)

                           3231 Southeast Sixth Avenue
                            Topeka, Kansas 66607-2207
               (Address of Principal Executive Office) (Zip Code)

                                 (785) 233-5171
              (Registrant's Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:

[ ]   Written communications pursuant to Rule 425 under the Securities
      Act (17 CFR 230.425)

[ ]   Soliciting material pursuant to Rule 14a12 under the Exchange
      Act (17 CFR 240.14a-12)

[ ]   Pre-commencement communications pursuant to Rule 14d-2(b) under the
      Exchange Act (17 CFR 240.14d-2(b))

[ ]   Pre-commencement communications pursuant to Rule 13e-4(c) under the
      Exchange Act (17 CFR 240.13e-4(c))

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ITEM 7.01      REGULATION FD DISCLOSURE

On March 30, 2007, Payless ShoeSource, Inc. announced that it had closed the
previously announced acquisition of Collective International, L.P. A copy of the
press release is attached hereto as Exhibit 99.1 and incorporated herein by
reference.

ITEM 9.01      FINANCIAL STATEMENTS AND EXHIBITS.

(d)            Exhibits

EXHIBIT #      DESCRIPTION
- ---------      -------------------------------------
99.1           Press Release dated March 30, 2007



                                   SIGNATURES

      Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                       PAYLESS SHOESOURCE, INC.


Date: March 30, 2007                   By: /s/ Ullrich E. Porzig
                                           -------------------------------------
                                           Ullrich E. Porzig
                                           Senior Vice President,
                                           Chief Financial Officer and Treasurer



                                  EXHIBIT INDEX

Exhibit No.    Exhibit
- -----------    -------------------------------------
   99.1        Press Release dated March 30, 2007